Vanishing surplus may put damper on farm bill debate

The committee’s vice chairman, Tom Robertson of Holly Ridge, Miss., gave a short briefing on the Delta’s economic climate, citing the impact of three years of drought and low commodity prices on the region’s infrastructure and the need for more assistance for farmers.

The secretary listened closely. Then, she asked Robertson what effect those economic problems had had on this year’s cotton plantings in Mississippi?

That exchange spoke volumes about the farm bill debate that is expected to resume on the floor of the House of Representatives and in the Senate Agriculture Committee in September.

The issue, summed up in a few words, is how do you provide meaningful assistance to struggling farmers without encouraging overproduction of commodities that are already in excess supply?

When Veneman met with the Delta Council leaders, USDA had not made an official estimate of Mississippi’s 2001 cotton acreage. But private surveys were indicating Mississippi farmers would increase their plantings by 20 to 30 percent — even though cotton futures were falling. (Later, USDA projected the increase at 30.8 percent.)

The intense farm bill debate that was expected in Congress may become even more gripping following the Aug. 22 White House announcement that the non-Social Security budget surplus will be less than $1 billion in the fiscal year that ends Sept. 30 and won’t be much higher than that in the new fiscal year.

The Senate Ag Committee chairman and several of its members were already sniping at the House Ag Committee bill and its return to the target price payments of earlier farm bills. Sen. Tom Harkin, the committee chairman, told participants in a field hearing in his home state of Iowa that such payments could lead to inflated land prices and “line the pockets of landowners” rather than farmers.

He also repeated his contention that more funding is needed for conservation programs and small, family farms. What Harkin and other members will do if agriculture loses the $73.5 billion in additional funding Congress was supposed to provide over the next 10 years is a subject of much conjecture in Washington.

Some think the administration won’t be too upset if the House and Senate Ag Committees have to go back to the drawing board. Veneman says USDA still intends to lay out “some basic principles” but will not offer a f arm bill of its own.

Traveling during Congress’ August recess, she continued to emphasize the need for new trade negotiating authority for the president. As she did in her speech at the Delta Council annual meeting, the secretary cited the importance of agricultural trade to farm income. Little was said about conventional farm programs.

“The Bush administration is committed to promoting economic activity and development in rural America and improving living conditions in rural areas,” she told farmers in Georgia and South Dakota.

Just how Congress and the administration decide to accomplish that goal could be the $73.5 billion question in the next few months.